Hiring good employees is one of the most important things you can do for your business. Our eight-step guide can help you to recruit and retain the right person for the job every time.

How to hire employees

1. Write a job description

In your business planning process, work out what you want an employee to do. Job descriptions should give employees a clear idea of their duties, responsibilities and who they report to. They should state an overall goal along with clearly set tasks required to achieve the goal. Don’t make descriptions too long, and remember to include a ‘…whatever else we want you to do’ statement at the end.

2. Work out what you want to pay them

Conduct a financial viability assessment to work out how much you can pay your new employee. You can also ask the candidate what wage or salary they have in mind as this may be less than your budget. But always make sure that you’re complying with your legal requirements to pay at least the minimum rate.

3. Advertise the job

You have a number of options for reaching your target market with job ads but, for many small businesses, word of mouth brings the best results. Other methods could be:

  • Newspapers
  • Specialist magazines
  • Web marketing
  • Social media
  • Recruitment agencies.

4. Shortlist and get them into your business

Regardless of what is said in an interview, the best way to determine employee productivity and effectiveness is to see them work. Organise a trial first or a probationary period and make sure that you pay them for any trial work.

5. The interview

Try not to be nervous. Remember, the potential employee will be more nervous than you! Let them do the talking rather than telling them everything about your business, brand strategy and expansion plans.

6. Check references

Having conducted your interviews you’ll have formed an opinion as to who will be the best person for the job. It’s very important that you now check the prospective employee’s references to ensure that the applicant has been accurate and honest about his or her previous occupations and employers.

7. Make an offer of employment

Once you’ve found your preferred employee, you need to offer them the job. You can make an initial offer of employment by phone, in person or by letter.

8. Probationary periods

There are some important guidelines to follow.

  • You must make the probationary situation very clear to your prospective employee from the start – they're on trial for a set period of time to determine whether they can do the job to the required level.
  • While employed, they have the same rights as permanent employees (statutory holidays, dismissal procedures, personal grievance).
  • You must very clearly spell out what your job standards and expectations are.
  • If they’re not performing, you must give them an opportunity to improve by offering support such as customer service training or additional resources.
  • If you have to dismiss them, you must follow the same procedures as for a normal employee. However, the notice period for both parties may be shorter than when the probationary period is completed.

As an employer, you're required to keep certain basic information by law. You won’t go wrong if you store all business records for seven years. These should include:

  • all wages and time record details
  • all leave taken and outstanding leave details
  • all tax information such as gross wages and PAYE records.

Benefits of staff training

You also need to recognise that new employees will take some time to get the hang of things. Staff training is important, as is allowing them some time to work out your way of doing things.

If possible provide a ‘buddy’ who can help them to improve productivity. Also allow them some room to make a few mistakes (within reason) as they find out how your business works.

Important information

The information contained in this article is correct as of July 2018 and is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article.

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